If it’s Wednesday, crude oil inventories are rising. This morning’s weekly inventory report from the Department of Energy showed crude oil inventories rose for a record 16th straight week. What was somewhat of a surprise, however, was the fact that stockpiles rose less than expected (It’s a start!). While traders were expecting crude oil inventories to increase by 2.5 million barrels, the actual increase was around 20% less at 1.91 million barrels. Even with the smaller than expected build in stockpiles, inventories are still at a record high and close to 150 million barrels above their historical average for this time of year. Looking at the historical trends, though, we should begin to see inventories draw-down in the weeks ahead as stockpiles typically peak for the first half in early May.
The chart below shows the rolling ten-week change in crude oil inventories since 1983. Over the last ten weeks, inventories have increased by 65.5 million barrels. While this is down from the record 10-week increase we saw a month ago, it is still significantly more than any other 10-week change we saw prior to 2014.